Every real estate transaction starts with a contract. These legal documents outline the terms and conditions of real estate transactions to ensure a smooth and successful investment process. When investing in real estate , it is important to understand the terms of the contract you are signing.

In this blog post, you will learn about what happens behind the scenes when you buy or sell a home?

What is a Real Estate Contract?

A real estate contract is a legally binding agreement between a property buyer and seller, specifying the details of the sales transaction. It includes information on

• The purchase price agreed-upon by both the property buyer and seller.
• The initial deposit to be made by the buyer to commitment to the purchase agreement. It is typically held in escrow by a third party.
• It  specifies the Closing Date by which the transaction must be completed.
• It clearly states conditions that must be met before the sale agreement can proceed such as financing options, inspection visits, and property appraisal.
• Property Condition: This clause outlines the condition of the property at the time of sale. It may include disclosures about known defects or issues.

Types of Real Estate Contracts

• purchase agreement between the property buyer and seller
• Lease agreement for rental property between landlord and tenant.
• Option contract given to a buyer to purchase the property within a specified time.

Negotiation In Real Estate Contract

Property buyers and sellers have opportunities to discuss and agree upon transaction terms that work best for them. These transaction terms include

• The final selling price of the property.
• The Closing costs of the transaction
• The conditions that must be met before the sale closes.

Mistakes To Avoid When Signing A Real Estate Contracts

While real estate contracts are designed to protect both parties, mistakes can happen. As a real estate investor or property buyer, you must ensure not to make these costly mistakes.

• Do not sign Incomplete document.
• Ensure that all information stated in the transaction contract is correct and complete.
• Carefully review the contract to understand all terms.
• Seek advice from a real estate agent or attorney.

The Role of Your Real Estate Agent

• Explain complex legal terms and clauses to help you understand the terms of the contract
• Negotiate on your behalf for the best investment deals.
• Offer advice on potential issues that can lead to investment loss and solutions

Conclusion

For a smooth and successful real estate transaction, there is a need for a mutually agreed upon contract in clear terms. A well prepared contract serves as insurance against any arising issue for both the property buyer and seller.

When you invest with MeritAbode Nigeria Limited, you can rest assured that your real estate transactions are handled with care and professionalism. We are provide our clients with the highest level of service and expertise.